In real estate, the three types of net leases are single, double or triple. Each type of net lease determines the types of expenses that a tenant or landlord should make to maintain a commercial real estate lease in Ohio. There are several differences between single, double and triple net leases.
The different types of single, double and triple net leases
Single net leases, also referred to as “N” leases, require that tenants pay the property taxes while their landlords cover the other expenses, including repairs and maintenance. The landlord is responsible for covering most of the expenses while the lease exists.
A double net lease requires the tenant to pay property taxes and insurance premiums. A triple net lease, known as NNN, requires the rent payments and three other expenses.
For a tenant, a net lease is more affordable than a regular lease because the rent amount decreases with the additional expenses that the tenant pays. A landlord pays fewer expenses while managing the tenant’s activities.
When a net lease is broken, a tenant or landlord has the right to seek real estate litigation and recover any financial losses. A tenant may stop making expenses payments, or a landlord could fail to repair or maintain the housing. The result is a breach of contract lawsuit that determines the extent of each party’s liability.
Evaluating the benefits of net leases
Net leases provide more affordable opportunities for investing successfully in commercial real estate. In single, double or triple net lease agreements, the tenants assume greater personal and financial responsibilities and provide additional benefits to their landlords.